Fannie's Windfall Blurs Debate Over Its Fate

Fannie Mae reported 2012 net income of $17.2 billion on Tuesday, its largest annual profit ever and first in six years, potentially reshaping the political debate over the fate of the government-controlled mortgage-finance firm.

The company, boosted by the housing market's turnaround and lower rates of soured loans, said that it "expects to remain profitable for the foreseeable future." Timothy Mayopoulos, Fannie's chief...